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Wall Street and options traders at odds over Apple

Wall Street is obsessed with the possibility of Apple shares soon rising to $150, but options traders appear to view that as a major long shot.

Barron's made waves over the weekend when it proclaimed that "Apple Is Worth $150 a Share." But this has long been the consensus among some professional Apple watchers.

Goldman Sachs analyst Simona Jankowski has had a $155 target on the now-$110 stock since last year, and she reiterated that target in a Tuesday note encouraging clients to buy ahead of the company's late April earnings report.

Gene Munster, Piper Jaffray's highly regarded Apple analyst, is even more bullish, with a target of $172.

Yet the story in the options market is very different. According to multiple data providers, options pricing implies just a 15 percent chance that the stock so much as touches $150 by the beginning of next year. And the option market's implied probability of the stock finishing above $150 by January expiration is just 6 percent.

What that means in practice is that on Tuesday, one can buy a call option that grants exposure to all of Apple's upside above $150 for just 80 cents. If Apple were to close at Munster's $172 target on Jan. 20, that option would increase in value more than twentyfold.

Yet given the range in which the stock has traded lately, such implied skepticism about these bullish targets is understandable. The stock is almost perfectly flat over the past six months, and it has been a notably quiet name. Indeed, the percentage size of its range from high to low this year is in the bottom tertile among S&P 500 stocks.

For the stock to soon rise 36 percent up to $150, then, would appear an unlikely outcome indeed.

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Brian Sullivan

Brian Sullivan is co-anchor of CNBC's "Power Lunch" (M-F,1PM-3PM ET), one of the network's longest running programs, as well as the host of the daily investing program "Trading Nation." He is also a frequent guest on MSNBC's "Morning Joe" and other NBC properties.

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